The pace of China’s auto market’s transformation to new energy has accelerated. According to the data of China Automobile Industry Association, the total sales volume of automobiles in China in 2021 was 26.275 million, with a year-on-year increase of 3.8%; The sales volume of new energy vehicles was 3.521 million, a year-on-year increase of 1.59 times. New energy vehicles have achieved the substitution effect on the fuel vehicle market and accelerated the transformation of the vehicle market to new energy. According to the new energy vehicle industry development plan, the proportion of new energy vehicles will reach 20% by 2025. We expect it to be relatively optimistic. It is expected that the annual sales volume of new energy vehicles will reach 5.5 million in 2022. By 2025, the proportion of new energy vehicles will far exceed the 20% predicted in the plan to reach 30%, the annual sales volume of vehicles will be 30 million, and the annual sales volume of new energy vehicles will exceed 9 million.
The penetration rate of new energy vehicles increased rapidly. According to the data of China Automobile Industry Association, the penetration rate of Shanxi Guoxin Energy Corporation Limited(600617) vehicles increased rapidly in 2021. The cumulative penetration rate of Shanxi Guoxin Energy Corporation Limited(600617) vehicles reached 13.4% from January to December 2021, of which the penetration rate reached 18.6% in December, which is close to the planning target. Compared with the penetration rate of 5.4% in 2020, the penetration rate of new energy vehicles showed a trend of rapid development.
The decline of subsidies for new energy vehicles is expected. According to the notice on the financial subsidy policy for the promotion and application of new energy vehicles in 2022, the subsidy standard for new energy vehicles will decline by 30% on the basis of 2021. We believe that the new energy vehicle market has changed from policy driven to market driven, and the decline of subsidies has a limited impact on the overall market growth of new energy vehicles. The policy gives a clear signal to car enterprises and consumers, defines the subsidy standard and subsidy exit time in 2022, and the industry has long expected the decline of new energy subsidies, so the further decline of subsidies will not have a great impact on the sales of new energy vehicles.
The price rise of new energy vehicles has become a general trend. From the end of 2021, major new energy brands began to release price increase signals. The price rise trend of new energy vehicles is determined mainly due to two reasons: one is the decline of subsidies in 2022, and the other is the continuous pressure of raw materials, battery prices and tight chip supply upstream of the battery, which has been transmitted to the whole vehicle. New energy vehicle enterprises enjoy less subsidies, and this part of the cost will be transferred to consumers.
Investment suggestion: the new energy vehicle industry will continue to have strong demand in the future, and investment opportunities will continue to emerge in the whole industry chain of new energy vehicles. At the same time, the valuation logic of new energy vehicles will be different from that of traditional vehicles. We believe that new energy vehicles have the attribute of science and technology consumption. New energy vehicle enterprises with high market share, high product technical barriers and good product experience will have high profit growth expectations, and their valuation will have the dual logic of science, technology and consumption, so they can get higher valuation. Electric vehicles will shape a new pattern of automobile enterprises. It is suggested to give priority to automobile enterprises that pay attention to R & D and transformation.
Risk tips: the demand growth rate does not meet expectations, the risk of policy changes, and the deterioration of the competition pattern of the industrial chain.
